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As Spainish Banks Collapse, German FinMin Blames Greece

Euro zone’s fourth biggest economy is collapsing. In a dramatic appeal Spanish Treasury Minister Cristobal Montoro signaled on Tuesday that the credit markets are shut for Spain and that the debt-ridden country cannot borrow money anymore. Prime Minister Mariano Rajoy is claimed to press for a direct European rescue package to save his country’s banks but Germany is reluctant, apparently pressing for a full international bailout, the combined aid by EU/ECB/IMF as for Greece, Portugal, Ireland.  Germany resists the urgent calls for issuing Euro Bonds. At least not before a fiscal union and a bank union. German Finance Minister Wolfgang Schaeuble went even so far to blame Greece for Spains’ banking crisis.

Spain is doing “everything right” with its reform measures but the country is suffering the effects of contagion from Greece, German Finance Minister Wolfgang Schaeuble was quoted as saying by Handelsblatt.

Schaeuble also said the euro zone needed to realise the medium-term project of fiscal union before discussing common euro zone bonds.

“The Spaniards are doing everything right and nonetheless they are coming under market pressure,” Schaeuble told the daily. “We need to manage this …through close and trusting coordination.” (Further reading REUTERS)

No, Schaeuble did not blame left-wing SYRIZA for the Spanish tragedy. Not yet. He could do it after the June 17 elections though…

PS I think, German Christian -Democrats are simply not able to cope with the crisis of the euro zone. Then, what’s the purpose of having at least four of EZ members into a bailout mechanism. While the next (Italy) may follow? What’s the purpose of enslaving citizens of EZ member-countries to an endless austerity? German Christian-Democrats should either come up with flexible, fresh ideas or resign and go retire in picturesque houses at the ever-green slopes of the Black Forest .  

BTW Spaniards are also rush to banks and withdraw their money.

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  1. Ireland went down. It was the Greeks’ fault.
    Portugal went down. It was the Greeks’ fault.
    Spain is teetering. It is the Greeks’ fault.
    Italian crisis is gathering speed. It is the Greeks’ fault.
    The French financial data are worsenig every day. It is the Greeks’ fault.
    Belgian debt is becoming unbearable, a bailout may be needed. It is the Greeks’ fault.
    Hungary enters back into recession and the value of the forint is going down again. It is the Greek’s fault.
    The US economy is not generating as many jobs as expected despite the stimulus. It is the Greeks’ fault.
    China is slowing down. It is the Greeks’ fault.
    Brazil is slowing down. It is the Greeks’ fault.

    Really, how can a small economy create such a mess?

    This scapegoating is becoming so out of touch, it is laughable.
    Time for the real players, especially Germany, to accept their ineffectiveness in dealing with the crisis that is been dragging for more than two years and is becoming the single most destabilizing threat of the world economy.

    • keeptalkinggreece

      that’s the destructive power of a small and unimportant country lol remember the Peter Sellers’ film the Mouse that Roared?

  2. “PS I think, German Christian -Democrats are simply not able to cope with the crisis of the euro zone. ”
    Yep, that’s what I think too! So why not having early elections in Germany instead of Greece…

  3. “What’s the purpose of enslaving citizens of EZ member-countries to an endless austerity?”
    Those citizens don’t have to endure austerity. They only have to find the money they want to spend elsewhere. They won’t get it from the rest of the Eurozone. Face it, when you’re up to your neck in debts and your creditworthyness is down in the gutter, what other alternatives than to cut back your spending do you have? All that anti-austerity brouhaha boils down to spending other people’s money, without offering at least a minimum chance that you’ll be able to ever pay it back or at least to stand on your own legs at one point. Sorry, but that won’t happen. If you want more money, print Drachmes. Period.

    • keeptalkinggreece

      Yeaaah! correct! do not forget that Spain will have to print pesetas, Italy Liras etc. From what I hear, the Spanish crisis has to do with the banks that gave incredible loans for real estate. Does it turn any light on?

  4. This has nothing to do with Joe Soap overspending. It has everything to do with banks being greedy beyond belief.
    This is the name of the game. The ECB lends money to the banks at 1%. The banks lends that same money to the government of Spain at 7% interest, on condition that the government gives it back to the banks (at no interest) to bail them out. Ditto in Ireland, Greece, Portugal, soon Italy, France…
    The merry-go-round of virtual money, fed by greedy banks with total disregards of any consequences of their insatiable hunger for more has come to a standstill. Suddenly, all this non-exitent money needs to somehow materialize, and Joe Soap ends up paying for it. It is a money laudering exercise on an enormous scale. At least, when a criminal gang launders money, it’s physical money, not make belief given some sort of respectability because it’s disguised as “banking activity” and printed on fancy paper in incomprehensible language.
    This bunch of gangster has been creating virtual money for years, and now we pay to turn it into “the real thing”…
    Anybody who can dream up a scheme like this has a sick mind, and anybody who stands up to defend it an even sicker one.